Author Archives: Daily Market Report

Gold gives up much of this week’s gains as recession thinking regains upper hand

(USAGOLD – 1/22/2021) – Gold gave up much of its gains over the past week this morning as commodities in general sold off and recession thinking regained the upper hand in financial markets. The yellow metal is down $31 at $1841. Silver is down 80¢ at $25.21. Matterhorn Asset Management’s Matthew Piepenburg sees opportunity in the precious metals’ market sell-off of the past few weeks.

“Although it’s normal to expect a correction phase within a larger bull market for both silver and gold,” he explains in an article posted at King World News, “the price retracements of late signal a buy opportunity for precious metal investors, not grounds for a bearish panic—unless you’re a gold trader blind to technical buy/sell signals. The broader bull market in gold today is much different than the bull markets of 1971 to 1978, or 2010, which saw very little interest/demand from western buyers. Demand going forward will in fact be driven more by western than eastern buyers, though current investors can’t ignore declining demand from China, Russia or India going forward. That said, the gold-silver dance described above will be very different going forward as both assets rally in synch rather than two steps up, one step back.”

Chart of the Day

bar chart showing gold's average annual prices 1971-2020

Sources:  St. Louis Federal Reserve [FRED], ICE Benchmark Administrtation [IBA]

USAGOLD note:  Most of our readers know that gold had a very good year in 2020 but few know that it posted its highest average annual price ever – $1770 per ounce.

Posted in Daily Market Report, dailyquotes, Today's top gold news and opinion |

Gold, silver take a breather after yesterday’s solid gains, poised for a run at key levels

(USAGOLD – 1/21/2021) – Gold looks to be taking a breather after yesterday’s solid gains. It is down $4 at $1869. Silver is down 4¢ at $25.89. Both look to be poised for a run at key levels – $1900 for gold and $26 for silver. Van Eck’s Joe Foster sees the same set of drivers that pushed gold higher in 2020 remaining in force for 2021 – market distortions (the mania), the huge debt load shouldered by both governments and corporations, worries over the Biden-effect, a possible vaccination-induced reenactment of the Roaring 20s (inflation), and persistent dollar weakness.

“Gold,” he says in a report released by the firm yesterday, “has been in a bull market since December 2015. The chart pattern of this market looks similar to the first five years of the 2001 to 2011 bull market. It will be interesting to see if the chart similarities continue. After 2006, the former bull market found catalysts in the 2008 Global Financial Crisis and the European Debt Crisis in 2010. The current bull market will certainly need further catalysts to realize similar gains. The risks we have outlined along with the dollar’s trend could provide such catalysts.”

Chart of the Day

Silver Price
Percent increase or decrease over prior year
2000-2020

bar chart showing annual average gains in silver 2000 to 2020

Data source: macrotrends.net• • • Chart by USAGOLD.com • • • Click to enlarge

Chart note: In 2020, silver recorded its best percentage gain in a decade – 46.3% – and posted its third largest gain over the 20 year period. It has posted gains – sometimes significant – in twelve of the last twenty years.
Posted in Daily Market Report, dailyquotes, Today's top gold news and opinion |

Biden’s inflation danger

Axios/Dion Rabouin/1-19-2021

cartoon showing a broken down tow truch pulling a disable economy

“President-elect Joe Biden’s $1.9 trillion stimulus proposal has economists and bullish market analysts revising their U.S. growth expectations higher, predicting a reflation of the economy in 2021 and possibly more booming returns for risk assets. Yes, but: Others are warning that what’s expected to be reflation could actually show up as inflation, a much less welcome phenomenon.”

USAGOLD note:  Former Fed economist DiMartino Booth is quoted as saying that the Fed might be careful saying it wants inflation. “Once the genie gets let out of the bottle,” she says, “the Fed’s not going to have a say in where inflation goes and I don’t think policymakers understand that.”

Posted in Today's top gold news and opinion |

Further upside for precious metals prices in 2021

Singapore Bullion Marketing Association/Nikos Kavalis

graphic of 2021 the year of gold?“Low rates and yields are typically positive for gold, as they minimise the opportunity cost of holding the zero-yielding metal. Moreover, given exceptionally low yields (or, in other words, high bond prices), the effectiveness of bonds as a hedge against market turmoil, and in particular equity market corrections, is hampered as it becomes harder to see yields fall much more. This forces investors towards other portfolio diversifiers, something that should continue to benefit gold.”

USAGOLD note:  London-based Metals Focus forecasts that gold will push toward the $2000 mark once again over the next few months then “reaching all time highs later in the year.  It also give a thumbs up to silver saying it will peak “in the high $30s before year end.”


Repost from 1-14-2021

Posted in Gold and Silver Price Predictions from Prominent Players, Today's top gold news and opinion |

Gold pushes higher as Wall Street mulls over the massive Biden borrow and spend economic program

(USAGOLD – 1/20/2021) – Gold pushed higher in early U.S. trading as Wall Street mulled over how the big-spending, debt-driven Biden economic program will play in financial markets. It is up $16 at $1858.50. Silver is up 24¢ at $25.53. Degussa’s Thorsten Polleit has some clear ideas where all of this will lead us in general and what the impact will be on one market in particular – precious metals.

“Global debt,” he writes in the firm’s January market report headlined The Great Gold and Silver Bull Market Is On, “has reached a level where it is no longer likely that central banks will allow interest rates to rise for the foreseeable future, and central banks will continue to finance government spending sprees willingly. Taken together, it does not take much to realise that the purchasing power of the US- dollar, euro, and other currencies will be further debased in what lays ahead. It is against this backdrop that we remain bullish on precious metals. We believe (and of course acknowledge the uncertainty that surrounds such a statement) that the price of gold could reach 2,450 USD/oz towards the end of 2021 (based on current prices, a 32% gain); the silver price could go up to 47 USD/oz (+87%) …” 

Chart of the Day

chart showing cycle of emotions from optimism to euphora to despondence and back eventually to optimism again

Chart note: “A speculative frenzy is sweeping Wall Street and world markets,” Bloomberg reported at the end of December. Cedric Ozazman, chief investment officer at Reyl & Cie in Geneva, commented at the time that “sentiment indicators are moving to euphoria.” Things have gotten even more frenetic since. In that same article, Bloomberg pointed out that global stocks are now worth $100 trillion and that “some $3 trillion of corporate bonds are trading with negative yields.”

Posted in Daily Market Report, dailyquotes, Today's top gold news and opinion |

Gold drifts higher; MKS Pamp sees the metal at $2300 in 2021

(USAGOLD – 1/19/2021) – Gold seesawed around the $1840 level in quiet overseas trading with little in the way of news to nudge it more convincingly in one direction or the other. Incoming Treasury Secretary Janet Yellen will testify before Congress today as part of her confirmation process, but not much is expected in the way of surprises. As it is, the dollar, one of the subjects she is expected to address, is trading lower, bond yields are rising, and gold is drifting slightly higher – up $1.50 in early trading at $1841. Silver is up 16¢ at $25.20. In MKS Pamp Group’s just-released Precious Metals Forecast 2021, Frederic Panizzutti, who manages the refiner’s Dubai office, forecasts a strong recovery for gold in 2021.

We expect 2021 to be another bullish year,” he writes. “While the global economic recovery shows some positive signs, we will continue to face uncertainties especially in the first half of the year. In the context of low global real interest rates, a slow recovery in growth, higher market volatility and a weakening USD, gold shall remain an asset of choice in investors’ portfolios as a safe haven and insurance against disruptions. More inflows into ETFs and increased physical demand, especially towards the second half of the year, shall comfort the upside trend. We expect gold to hit a new all-time high at 2300.00 USD/Ounce.”

Chart of the Day

U.S. Dollar Index
(One year)

Line chart showing the performance of the US Dollar Index over the past 12 months in percent

Chart courtesy of TradingView.com • • • Click to enlarge

Chart note: A flight from safe havens drove gold’s selloff over the past two weeks – that departure, principally from the bond market, added high octane to the speculative stock market frenzy. Many analysts believe that the most dangerous outcome from current Federal Reserve policy will be a sharp decline in the dollar. Over the past twelve months, the U.S. Dollar Index is down 7% and 11.5% from highs this past March.

Posted in Daily Market Report, dailyquotes, Today's top gold news and opinion |

Gold gets back on the plus side in quiet holiday trading

(USAGOLD – 1/18/2021) – Gold got back on the plus side this morning in quiet holiday trading. It is up $7 at $1836.50. Silver is up 12¢ at $24.98. Analysts, generally speaking, are giving commodities positive reviews for the upcoming year. As shown in our Chart of the Day, though, the sector underperformed other key assets in 2020. A number of top forecasters, including Goldman Sachs, believe all that will change in 2021 as the neglected asset class garners renewed investor attention. Jeff Currie, the firm’s chief commodity analyst, went so far as to say the commodities “ship has sailed. If you look at all the classic telltale signs of a structural bull market, you have the weak dollar, grain prices…a client called corn ‘bitcorn’ recently — and then you have what’s going on in the metals markets.”

Corny references aside, gold – generally considered top dog in the commodity realm – outperformed all the stock indices in 2020 save the NASDAQ, according to the World Gold Council survey released last week. (The study leaves out silver, however, which outperformed both gold and the NASDAQ.) “Led by gold,” says Bloomberg commodity analyst Mike McGlone in a tweet late last week, “we expect broad commodities to continue advancing in 2021 and view energy as the most vulnerable sector.” Gold, continues McGlone, “four ounces of which has been roughly of equal value to an acre of Iowa farmland since 1973, or the S&P 500 Total Return Index since 1997 – may be on the rise, notably vs. the stock market.”

Chart of the Day

bar chart showing gold's performance against other major asset classes

Chart note:  This chart shows gold’s strong performance versus other major asset classes in 2020 outdone only by the high-flying NASDAQ. Not shown? Silver, the year’s overall  top performer –  up 46%.

Posted in Daily Market Report, dailyquotes, Today's top gold news and opinion |

Notable Quotable

–––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––

“My studies of the 17 major financial crises since the founding of the Republic reveal that over-optimism is an important driver of the bubbles that eventually become busts. As the legendary investor, Sir John Templeton, once said, ‘The four most dangerous words in investing are ‘This time is different.’ Such was the mind-set that real estate prices could only rise (2008), dot-com companies would forever grow and be profitable (2001), or that the Russian government would never default (1998). “

Robert F. Bruner
The Hill

–––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––

Posted in Notable Quotable, Today's top gold news and opinion | Tagged |

Gold holds line at $1850. JP Morgan increases weighting in commodities and Metals Focus sees high $30s for silver by year end

(USAGOLD – 1/15/2021) – Gold continued to hold the line at the $1850 mark this morning, ignoring the massive Biden stimulus program and the ongoing political turmoil in the national capital. It is up $3 on the day at $1851. Silver is down 18¢ at $25.40. JP Morgan lightened up on its bond portfolio and raised its exposure in the commodities market, according to Bloomberg’s morning e-mail. “Commodities,” says the news service, “will benefit from strong economic growth and fading risks from issues like the trade war, pandemic, and Brexit.” If that be the case, silver, which enjoys status both as a commodity and a monetary metal, could be among the beneficiaries. Gaining 46% last year, the top performer in the commodities sector also outpaced all major investments, including the much-publicized NASDAQ index.

Nikos Kavalis, a founding partner in London-based research firm, Metals Focus, tells why he thinks the coming year could be a good one for silver. “Although the crisis did weigh on silver demand,” he says in an overview for 2021 published by the Singapore Bullion Marketing Association, it was less pronounced than for gold. This reflects silver’s lower reliance on price elastic and discretionary demand segments, being a largely industrial metal and with some offset from rising bar and coin demand in the West…Looking ahead, we have little doubt that the drivers of gold demand will also boost silver’s appeal to investors. In addition, owing to its typically more volatile nature, we would expect silver to outperform gold overall in 2021, peaking in the high $30s before year-end.”

Chart of the Day

Gold and Silver
(Full year, 2020)
overlay chart showing the percentage gains in gold and silver for 2020

Chart courtesy of TradingView.com • • • Click to enlarge

Chart note: For the record, here is the chart showing gold and silver’s percentage gains for 2020. Gold was up 24.21% and silver was up 46.3% – the top-performing major asset for 2020.

Posted in Daily Market Report, dailyquotes, Today's top gold news and opinion |

Gold rangebound despite upcoming Biden administration stimulus announcement

(USAGOLD –1/14/2021) – Gold remained range-bound despite reports circulating that the incoming Biden administration is preparing to unveil a $2 trillion stimulus program – one that is likely to sail through the new Democrat-controlled Congress. Some might think that odd since it was thoughts of stimulus dancing through Wall Street’s mind that sent both gold and stocks soaring at the end of last year. A quick look at the 10-year bond yield – now at 1.1% – explains why things might be different at this juncture. (Please see “The bubble either inflates or bursts…”(1/12/2021) As it stands, gold is down $5 at $1843. Silver is up 13¢ at $25.42. Stocks, now up marginally on the day, seem equally uninspired. It might take a while, as it did early last year, for reality to impose itself on the markets with full force, but Crescat Capital’s Kevin Smith and Tavi Costa see it as inevitable – albeit for different reasons.

“The problem,” they write in a recently released report, “is that money printing married with fiscal spending is crashing head-on with an emerging commodity supply problem that will likely stir up rising inflation which is bearish for both equities and fixed income. Get ready for a volatile 2021, the year of reckoning for twin asset bubbles as the world attempts to emerge from the Covid-19 pandemic. Global central banks added a total of $9.1 trillion of assets to their balance sheets in 2020. To compare, this year’s monetary stimulus was about three times their response to the Global Financial Crisis in 2008. We also saw at least $25 trillion of newly issued debt worldwide while the aggregate value of all negative yielding bonds reached close to $18 trillion in 2020. With this macro backdrop, it is staggering to see a monetary metal like silver still trading sub $30/oz.”

Chart of the Day

bar chart showing central bank net gold sales and purchases 2002-2020

 Click to enlarge

Chart note:  Central banks remained net buyers of gold in 2020, though the pace slowed somewhat. “There are good reasons,” says the World Gold Council in a report issued yesterday, “why central banks continue to favor gold as part of their foreign reserves which, combined with the low interest rate environment, continue to make gold attractive.” The Council expects 2021 to be “not much different” from the year just ended.

Posted in Daily Market Report, dailyquotes, Today's top gold news and opinion |

Gold drifts higher in quiet mid-week trading

(USAGOLD –1/13/2021) – Gold drifted higher in quiet mid-week trading, with the $1850 looking like the support level – at least for now. It is up $3 at $1860. Silver is down 12¢ at $25.52. Generally speaking, the markets are in the quiet mode this morning, with nothing standing out save the latest chapter in the unfolding saga in Washington. Of late, the financial world has had its eye on rising longer-term bond yields. “[I]nvestors searching for an explanation [for gold’s recent plunge],” writes Gold Newsletter‘s Brien Lundin in a client advisory e-mailed yesterday, “need to remember one basic fact: The bond market drives everything.” Rising yields and weakness in the gold market have created something of a deja vu harkening back to last March’s “Great Liquidity Crisis.” (Please see “The bubble either inflates or bursts…”(1/12/2021) Gold sold off early in that crisis then surged as concern about the widespread systemic risks and the effect on the dollar became apparent. On the other hand, the dollar went into a steep retreat, as shown in this morning’s Chart of the Day. As you can see, the two took separate paths beginning early in 2020 – a process that accelerated as the year progressed.

Chart of the Day

overlay chart showing the US Dollar Index and gold divergence in 2020

Sources:  St. Louis Federal Reserve [FRED], Federal Reserve Board of Governors, ICE Benchmark Administration
Click to enlarge

 

Posted in Daily Market Report, dailyquotes, Today's top gold news and opinion |

Gold reverses course in overnight market, gives most of it back in early U.S. trading

(USAGOLD –1/12/2021) – Gold reversed course in the overnight market after finding support near the $1850 level, then gave back most of those gains early in the U.S. trading session after being up almost $18. The yellow metal is now up $2.50 on the day at $1848.  Silver is up 34¢ at $25.33. After all is said and done, gold is down about 5% year to date. Silver, the more volatile of the primary precious metals, is down just over 7% so far this year. We invite you to read the post immediately below for a more detailed view of the latest correction.

Sovereign Man’s Simon Black sees trouble ahead for the dollar once the spending and monetary policies envisioned under the new Biden administration are fully deployed, and that could resonate in the gold market. “[T]here will likely be plenty of cooperation between the Fed and Treasury to print absurd quantities of money this year,” he writes in his outlook for 2021. “Certainly, there will be some bondholders who extend their securities. But most likely the Fed will need to print another $3+ trillion, pushing its balance sheet beyond the $10 trillion mark. And if they really go down this destructive path– $30 trillion national debt, a $10 trillion Fed balance sheet– then 2021 may be the year that the world finally loses confidence in the US dollar. On another note… We think gold could DOUBLE and silver could increase by up to 5 TIMES in the next few years.”

Chart of the Day

bar chart showing US Mint sales of silver bullion coins through 2020

Chart courtesy of GoldChartsRUs • • • Click to enlarge

Chart note:  U.S. Mint silver bullion coin sales surged in 2020, posting their best year since 2016, and the new year is off to a strong start if activity at USAGOLD is any indicator.

Posted in Daily Market Report, dailyquotes, Today's top gold news and opinion |

Gold continues retreat; ‘everyone knows they need a safe haven’ – Merryn Somerset Webb in weekend FT

(USAGOLD –1/11/2021) – Gold continued its retreat as a follow-up to Friday’s plunge. The yellow metal is down another $14 at $1838. Silver is down 66¢ at $24.86. The metals’ drop coincides with an across-the-board slide in commodities prices this morning. The dollar is up marginally and U.S. Treasuries, gold’s safe-haven competitor, seem to have stabilized – at least for the moment. For a more detailed assessment of the current market mix, we invite you to scroll further down the page for this past Friday’s Afternoon Update.

MoneyWeek’s Merryn Somerset Webb posted a reminder of gold’s baseline portfolio role in the Financial Times’ over the weekend. “Think of the reasons to hold gold,” she writes. “If inflation is coming (and it probably is) you want to hold a real asset that can hedge against it — one that can’t be inflated away by relentless money creation and currency debasement. That’s particularly the case in an era of very low interest rates. If governments work to keep interest rates lower than inflation in order to reduce the real value of their horrible debt burdens, everyone knows they need a safe haven, but everyone also knows the traditional ones (government bonds) no longer offer that safe haven. That turns us to gold, the one asset that has a 3,000-year record of protecting purchasing power. No wonder the gold price is up around 40 per cent since 2018. I hold a lot of gold for all these reasons.”

Chart of the Day

bar chart showing US Mint sales of gold bullion coins in ounces through 2020Chart courtesy of GoldChartsRUs • • • Click to enlarge

Chart note:  U.S. Mint sales of gold bullion coins posted their best year since 2016 at 1.078 million ounces and the sixth-best year since 2000

Posted in Daily Market Report, dailyquotes, Today's top gold news and opinion |

Afternoon Update

Gold finds itself stuck on the wrong side of a frenzy … at least for the moment

Cartoon by Ed Stein of dollars flowing in an hour glass and investor caught in flow saying 'keep printing'(USAGOLD – 1/8/2021) – It looks like gold will settle at $1852 – down $64 on the day.  Silver is finishing at $25.52 – down $1.66 on the day. To say that the investment world is at a loss to explain what happened in the gold market the past few days would be an understatement. Stretch that a bit, and we can say that most investors are equally perplexed by the delirious rise of Tesla and bitcoin. We come back to Jeremy Grantham’s comments (scroll down the page) about “waiting for the last dance.” The current market mania, he warns, “will be recorded as one of the great bubbles of financial history, right along with the South Sea bubble, 1929, and 2000.”

In short, gold seems to have gotten itself stuck, for some inexplicable reason, on the wrong side of a frenzy, at least for the moment – one that involves not just the markets but possibly politics as well. “Biden,” writes analyst Barani Krishnan at Investing.com, “has also said he plans to push out at least two more comprehensive stimulus packages that could add trillions to the U.S. federal debt, already estimated at $3.8 billion for 2020. In ordinary times, the combined impact of such spending on the dollar logically makes gold a natural hedge. But these are extraordinary times when logic gets tossed out of the window. Treasury yields jumped 3% on the day and 21% on the week — the most since the week ended Aug 7, when a similar rally in bonds killed gold’s $2,000 plus rally.” That says it about as well as it can be said.

In the end, though, logic will prevail – or at least we believe it should prevail – and gold’s journey of the past few days could evolve into another one of those situations when it took the elevator down and now faces the challenge of taking the stairs back up. Gareth Soloway, the chief market strategist at InTheMoneyStocks.com, profiled courage in a Kitco interview earlier today as events evolved. “Gold is getting pounded today, and the one thing I would say to investors who are into gold,” he ventured, shaking his head, “is stick with it.…Look for gold to perform well even on the pullbacks. I would be a buyer today. I really would.”

Posted in Today's top gold news and opinion |

Three media takes on today’s downside market action


Gold buckles under firmer dollar, bond yields ahead of payroll data
Reuters/Eileen Soreng/1-8-2021


Gold tumbles back below $1900 as technicals drive selling
Bloomberg/Eddie Spence/1-8-2021


Gold prices fall over 1%, slip from perch at $1,900 an ounce
MarketWatch/Mark DeCambre/1-8-2021


Stay tuned. We will update if more information becomes available.

Also, we may post a full update later today.

Posted in Today's top gold news and opinion |

No DMR today ……Below is Thursday’s report. For updated market information on today’s market action, please visit our Top Gold News and Opinion page.


Gold settles down after yesterday’s counterintuitive waterfall drop

(USAGOLD – 1/7/2021) –  Gold has settled down a bit from yesterday’s waterfall drop. It is down $4 at $1917. Silver is down 22¢ at $27.16. Analysts, by and large, remain at a loss to explain the counterintuitive plunge. Washington’s gridlock is now broken in favor of the fiscally-challenged Democrats. So why the big selloff? Yesterday we made a passing reference in this report to investors selling the news out of Georgia. Gold Newsletter’s Brien Lundin expanded on that notion in a special advisory issued yesterday afternoon.

“Combined with silver failing to leverage gold’s move to the downside,” he said, “it seems that speculators using gold’s poor cousin and the mining stocks to play the gold theme aren’t too enthusiastic about jumping ship. So why has gold sold off, despite news that should be sending the metals much higher? Two reasons, in my opinion. First is the usual trader’s mentality of ‘buy the rumor, sell the news.’ Lots of hot money had placed bets in recent weeks on such an outcome, and these speculators rushed to take profits once the game ended. This provided the initial selling pressure. Next came the bond market’s reaction to the development, with yields understandably jumping as confidence waned in the future fiscal responsibility of the republic.”

Chart of the Day

Silver Price
Percent increase or decrease over prior year
2000-2020
bar chart showing annual average gains in silver 2000 to 2020Data source: macrotrends.net• • • Chart by USAGOLD.com • • • Click to enlarge

Chart note: In 2020, silver recorded its best percentage gain in a decade – 46.3%.  It has posted gains in twelve of the last twenty years.
Posted in dailyquotes |

No DMR today ……

Posted in Daily Market Report, Today's top gold news and opinion |

Gold settles down after yesterday’s counterintuitive waterfall drop

(USAGOLD – 1/7/2021) –  Gold has settled down a bit from yesterday’s waterfall drop. It is down $4 at $1917. Silver is down 22¢ at $27.16. Analysts, by and large, remain at a loss to explain the counterintuitive plunge. Washington’s gridlock is now broken in favor of the fiscally-challenged Democrats. So why the big selloff? Yesterday we made a passing reference in this report to investors selling the news out of Georgia. Gold Newsletter’s Brien Lundin expanded on that notion in a special advisory issued yesterday afternoon.

“Combined with silver failing to leverage gold’s move to the downside,” he said, “it seems that speculators using gold’s poor cousin and the mining stocks to play the gold theme aren’t too enthusiastic about jumping ship. So why has gold sold off, despite news that should be sending the metals much higher? Two reasons, in my opinion. First is the usual trader’s mentality of ‘buy the rumor, sell the news.’ Lots of hot money had placed bets in recent weeks on such an outcome, and these speculators rushed to take profits once the game ended. This provided the initial selling pressure. Next came the bond market’s reaction to the development, with yields understandably jumping as confidence waned in the future fiscal responsibility of the republic.”

Chart of the Day

Silver Price
Percent increase or decrease over prior year
2000-2020
bar chart showing annual average gains in silver 2000 to 2020Data source: macrotrends.net• • • Chart by USAGOLD.com • • • Click to enlarge

Chart note: In 2020, silver recorded its best percentage gain in a decade – 46.3%.  It has posted gains in twelve of the last twenty years.
Posted in Daily Market Report, dailyquotes, Today's top gold news and opinion |

Gold attempts recovery from major wave of overnight selling. Piepenberg: ‘smart money understands the difference between staying rich and getting rich’

(USAGOLD – 1/6/2021) – Gold recovered quickly from a major wave of selling in overnight markets that took the metal from two-month highs at $1956 to $1925 at one point. It is now trading at $1938 – down $14 on the day. Silver is down 17¢ at $27.47. The downward spike caught many by surprise as there was no apparent reason for it, except perhaps some entity taking profits on a massive position, i.e., selling the news out of Georgia. After all, at $1956, gold had already posted a more than 4% gain in 2021 on a wave of New Year buying. Signals Matters’ Matthew Peipenberg had some interesting things to say about gold buyers in a piece posted recently at the GoldEagle website.

“Because unlike the straw and mud of fiat currencies and dangerously overvalued stocks and bonds,” he writes, “gold rises strong (rather than falls into dust) when the market wolf huffs and puffs and blows bad portfolios down. Smart money, like just about anything smart, including that third little piggy above, are by nature a smaller circle, a more far-sighted minority, and thus think more of steady wealth preservation than easy wealth creation. In short, the smart money understands the difference between staying rich and getting rich. Physical gold, as a timeless (rather than trendy or pass?) instrument of wealth preservation, serves as the historically-confirmed and surest way to ensure one’s wealth against the ravages of currency debasement.” Our Chart of the Day unambiguously supports Piepenberg’s argument. Gold has posted gains in sixteen of the last twenty years.

Chart of the Day

Gold Price
Percent increase or decrease over prior year
2000-2020bar chart showing gold's annual percentage increase 2000-2020Data sources:  St. Louis Federal Reserve [FRED], ICE Benchmark Association
Chart by USAGOLD.com • • • Click to enlarge

Chart note:  For the full year 2020, gold turned in its best year since 2010, rising over 24% and ending the year at the $1900 mark. As you can see, gold posted gains in sixteen of the last twenty years – a formidable record by any standard.

Posted in Daily Market Report, dailyquotes, Today's top gold news and opinion |

Precious metals extend yesterday’s strong advance; U.S. Mint posts best year for bullion coin sales since 2016

(USAGOLD – 1/5/2021) – Gold and silver extended their advances this morning with the yellow metal pushing over the $1950 mark to trade at $1952 – up $6.50 on the day. Silver is up 16¢ at $27.47. “Demand for United States Mint bullion products,” reports CoinNet.com, “surged in 2020 to the highest points in several years – for both gold and silver coins…2020 American Eagle silver coins jumped to 30,089,500 ounces this year, more than doubling the amount of a year ago…2020 American Eagle silver coins jumped to 30,089,500 ounces this year, more than doubling the amount of a year ago.” In both the gold and silver bullion coin categories, 2020 sales were the best since 2016. The demand for modern bullion coins is, to a large extent, the mirror image of declining currencies against gold, as shown in our Chart of the Day.

Chart of the Day

Gold in Major Currencies
Indian rupee, Chinese yuan, British pound, U.S. dollar, Japanese yen, European euro

line chart showing the performance of gold in various currencies for 2020

Chart courtesy of TradingView.com • • • Click to enlarge

Chart note: Gold rose sharply in six of the world’s top currencies in 2020 – Indian rupee (+28.1%); Chinese yuan (+17.3%); British pound (+21.2%); U.S. dollar (+25.1%); Japanese yen (+18.9%) and European euro (+14.8%). Gold’s gain in those currencies reflects concern among the citizenry of present and future debasement as well as the attendant systemic risks.

Posted in Daily Market Report, dailyquotes, Today's top gold news and opinion |